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Frepple overview for inventory planners
1.
Open source supply
chain planning software Introduction for inventory planners
2.
© 2017 frepple.com Agenda
Inventory planning workflow Safety stock and reorder quantity calculation Inventory plan review A day in the life of an inventory planner Cockpit screen Distribution planning screen Inventory and inventory detail reports
3.
© 2017 frepple.com Inventory
planning workflow Forecast + Inventory planning parameters Safety stock + ROQ Inventory profile + Replenishment plans Inventory optimization Plan Workflow steps: 1. Safety stock generation 2. Reorder quantity generation 3. Safety stock, ROQ and inventory review and analysis
4.
© 2017 frepple.com Inventory
planning workflow Three calculation steps 1. Compute a safety stock based on the service level, based on: Demand forecast Expected customer service level Demand variability Supplier lead time variability 2. Constrain the output of step 1 to be within a minimum and maximum quantity 3. Constrain the output of step 2 to be within a minimum and maximum period of cover 1 Safety stock calculation
5.
© 2017 frepple.com Inventory
planning workflow Three calculation steps 1. Compute a economic reorder quantity using the Wilson formula, based on: K = Fixed ordering cost D = SKU forecast h = Annual holding cost rate 2. Constrain the output of step 1 to be within a minimum and maximum quantity 3. Constrain the output of step 2 to be within a minimum and maximum period of cover 2 Reorder quantity calculation
6.
© 2017 frepple.com Inventory
planning workflow Inventory planners review the safety stock to: Make sure the service levels associated to a SKU are appropriate and don’t generate too much or not enough stock Set fixed quantities for SKUs where there is not enough demand history to fully rely on the forecast Set fixed periods of forecast for fast movers to make sure no stockout will occur … Inventory planners review the ROQ to: Make sure not to order too frequently from a supplier Ensure the ROQ are not too high generating unnecessary stock 3 Inventory planning review
7.
© 2017 frepple.com Manage
inventory policies Safety stock and reorder policies can be defined: For individual item x location pairs For segments: a group of item x locations Segments are defined based on item and location characteristics: eg item.cost > 10 and location.category = ‘shop’ Business rules are applied to all item x locations in a segment eg service level = 95% for all item x locations in the segment Fast movers expensive Category A expensive Category A cheap New parts cheap Parts at shops
8.
© 2017 frepple.com Stock
rebalancing FrePPLe can identify opportunities for stock rebalancing Excess inventory at a location can be returned to its source location if it meets these conditions: Part cost is high enough Total cost of the returned material is high enough The excess doesn’t “burn off” within a certain time Shop On hand = 1000 units Forecast= 10 units / month Warehouse Item distribution Example: Shop has stock to cover more than 8 years of demand
9.
© 2017 frepple.com Agenda
Inventory planning workflow Safety stock and reorder quantity calculation Safety stock and reorder quantity review and analysis A day in the life of a inventory planner Cockpit screen Inventory planning screen Inventory and inventory detail reports
10.
© 2017 frepple.com Cockpit
screen All users workflows start their work on the cockpit screen Every user can configure a personal dashboard with the widgets that fit his/her tasks For an inventory planner the following widgets can be useful: Inventory by Item Inventory by location Stockout risk Purchase orders
11.
© 2017 frepple.com Inventory
Planning : Top section The inventory planning screen is the main screen for safety stock and ROQ review The top section displays a grid providing relevant information for current period such as : Stockout risk Safety stock ROQ Open PO Proposed PO …
12.
© 2017 frepple.com Inventory
Planning : Middle section The middle section offers many tabs to review the forecast, the plan, the transactions… In the plan tab, the safety stock, the ROQ, the starting and ending inventory are displayed for current and future periods
13.
© 2017 frepple.com Distribution
Planning : Middle section The transaction tab allows the planner to: Review purchase orders and distribution orders needed to obtain the desired inventory profile Export them to the ERP system
14.
© 2017 frepple.com Inventory
Planning : Bottom section The bottom section allows the planner to modify the stocking policy for a SKU by selecting the method to calculate the safety stock and the reorder quantity Check the system proposal See the constraints specified by the segments and business rules Override and constrain the system proposal
15.
© 2017 frepple.com Distribution
orders The distribution order screen gives a prioritized list of stock transfers: RED: Need urgent planner attention Expedite to avoid a stockout Time to place a new purchase order ORANGE: Need planner attention GREEN: No action required yet Bottom section of the screen shows full detail on the selected record(s)
16.
© 2017 frepple.com Purchase
orders The purchase order screen gives a prioritized list of open and proposed purchases: RED: Need urgent planner attention Expedite to avoid a stockout Time to place a new purchase order ORANGE: Need planner attention GREEN: No action required yet Bottom section of the screen shows full detail on the selected record(s)
17.
© 2017 frepple.com
Other screens used for occasional review and analysis, depending on the inventory planners’ responsabilities: Other screens Alerts for excess inventory Identifies item-locations with on hand level exceeding the planned maximum Purchase order analysis Review already confirmed open purchase orders that are critical. You should contact the supplier of critical purchase orders to expedite the delivery. Inventory report Review the inventory profile for a series of item x locations Inventory detail report Review the details of all material consumption and production
18.
© 2017 frepple.com Try
it out yourself Online demos can be accessed at: https://manufacturing.frepple.com https://distribution.frepple.com User : admin Password : admin Hint: Use the “guided tour” to walk through the “day-in-the-life” workflows
Download now